Gold is on track to post a weekly loss as the US central bank sticks to monetary tightening

Gold prices rose slightly on Friday as the dollar fell, but the yellow metal, which does not yield a return, is now on its way to record a weekly loss, with the Federal Reserve expecting interest rate hikes to continue for a longer period.

Spot gold rose 0.2 percent to $1,780.78 an ounce by 0621 GMT. And US gold futures rose 0.1 percent, recording $ 1,789.

The dollar index fell 0.2 percent, making gold less expensive for buyers from abroad.

Gold prices have fallen nearly 1 percent for the week so far, retreating sharply from the highest level in five and a half months since the Fed’s decision on Wednesday to raise interest rates by 50 basis points as expected and Chairman Jerome Powell saying more hikes would take place next year. Even though the economy is slipping into recession.

Gold is known as a hedge against inflation, but high-interest rates tend to weaken its attractiveness because it increases the opportunity cost of holding non-returnable metal.

Meanwhile, India raised the primary import price of gold and silver late Thursday evening. India is the world’s largest importer of silver and the second-largest importer of gold.

As for other precious metals, silver rose 0.2 percent to $ 23 an ounce, but it has so far recorded a decline of two percent for the week.

Platinum rose 0.6% to $1,000.54, and palladium rose 1.5% to $1,817.88, but was on track for its biggest weekly decline in two months.